Chapal launches long-term plan

Pakistani master-developer of real estate projects, Chapal World is offering an eight-year flexible payment plan with just Dh5,000 deposits to attract end-users, that analysts say, could stimulate the UAE's stagnant property market for a solid growth.

"We are the first developer to launch the eight-year payment plan in the UAE. This comes from our experience in Pakistan where we have implemented this to help buyers," said Mohammad Amin Chapal, chairman of Chapal World, a company which delivered 25,000 homes to customers in 40 years.

Customers book apartments with Dh5,000 first. Then after a month, they start paying in monthly instalments - 96 cheques to be precise. In 24-30 months, when they have paid just 24 to 30 per cent, they get possession of the property and move in and keep paying for the rest of the tenure till maturity.

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"This way, a family can easily own a property without seeking bank finances. The investors and end-users gain possessions of the properties while having paid only 25-30 per cent of the property value and keep on paying on monthly instalments till maturity, while we as developers take risks."

"We entered the UAE three years ago and launched our first project two years ago - November 2006. Today Chapal World has a portfolio of Dh20 billion involving 8,832 units."

In three years time, the company graduated itself from a developer to a master-developer by involving itself in Jumeirah Lake Towers - a master-planned community in Ajman.

Chapal is currently diversifying its business activities by launching facilities management arm, an investment arm, a micro-financing arm and a construction company to consolidate the real estate business.

Chapal, who is celebrating 40 years of the company's establishment, said, the current market situation is temporary.

"We are all aware of the present market condition. It is suffering due to lack of enough liquidity. In a business cycle where there are plenty of ups and downs, we are at a difficult juncture of the economic cycle. The market is declining and it is yet to bottom out," he said.

Property prices in the UAE are declining as the speculators have left the market. As investor confidence is still low, business activities - buying and selling - have declined, putting downward pressure on property prices further.

"It is a challenging time for the industry and the overall economy as real estate and construction have been driving the UAE's economic growth. If these two sectors suffer, then the rest of the economy will also be affected," he said.

"We are victims of the global financial crisis. The US recession has hit the world badly and we are not immune to the crisis. In any business sector, a strong boom invites investors and speculators, who take advantage of the opportunities and also contribute to the growth by investing and fuelling the value of assets.

"While money and ownership of assets change hands, the property prices and values also appreciates - to a certain level when investment becomes unattractive. We have witnessed this for a while.

"However, I can see light at the end of the tunnel. This is a temporary phase. We are here to stay. Our commitment to the UAE is very solid. That's why we are going ahead with all our projects, without delaying."

From: gulfnews.com

Dubai real estate collapse

The real estate industry’s collapse in Dubai has caused more damage to the Pakistani elite than the losses they are facing in their industries in Pakistan. Around $72.35 billion worth of property projects are stated to have stalled in Dubai.

Rumours are ripe in Dubai that these projects, undertaken by some renowned real estate developers, have been put to an indefinite hold. There is no official word from the developers about the stoppage of work but those who visit Dubai could see that work on over 50 building projects costing $3.8 million to $70 million has come to a standstill. Out of this, cancellation of work on real estate projects worth $3.275 billion has been confirmed.

Investors from around the globe had booked apartments in these projects by paying advance payments to the developers. They do not know whether they would get back their investment. Most of the capital flight from Pakistan in the recent past landed in Dubai for investment in real estate. The flight of capital during the past 12 months has been admitted even by the Adviser to Prime Minister on Finance, Shaukat Tarin.

There is no real figure about the exact investment by Pakistani entrepreneurs in Dubai’s real estate. The money was sent through back channels and the Federal Investigation Agency estimates a minimum outflow of over $3 billion during the first few months of the current government, which sent the rupee to over Rs83 against the dollar. The recovery of the rupee started after International Monetary Fund’s standby arrangement in November last year.

Dubai has remained a favoured destination for Pakistani investors. However, until a year ago only the richest invested their resources in the most enterprising Gulf state. Last year, even medium-sized entrepreneurs panicked by deteriorating economic conditions in the country rushed to invest in real estate in Dubai which was booming at that time.

The Dubai government then introduced the condition of one apartment for one family. Under this rule, the definition of family was husband, wife and children. Sisters, brothers or other relatives were not permitted to stay in the same apartment. This caused turmoil in the real estate business in Dubai as these apartments were occupied by a large number of workers who shared high rent. Individual workers could not afford to pay for separate apartments and vacated them causing a sharp decline in rents and real estate prices.

The investors are in a fix. Those who got possession of their property find the rent very low but cannot dispose of the property because prices are very low. However, most of them who invested in real estate during the last one year have not even got possession of their property and now construction of most of the projects is on hold with real possibility that these would be abandoned.

The cancelled projects in Dubai include $1.3 billion Nad El Sheeba race course which was being built by Mayden LLC. The $680 million Falcon City of Wonders undertaken by ETA Star has also been scrapped. The Dubai Exhibition City project worth $450 million has also been cancelled. Desert Gate Hotels and Towers being built at an estimated cost of $350 million by Bawadi LLC has been abandoned. Pikington Emirates has announced cancellation of its $200 million Float Glass Factory project. Walter’s Edge (Business Bay), a $125 million project of Damac Properties, has also been called off. The same builder has stopped a $100 million Dolphin Tower project. Nadra Tower (Business Bay), a project of Tanweel, has also been cancelled. It was to be built at an estimated cost of $70 million.
From: thenews.com.pk

Prospects bleak for Pakistanis returning from UAE

Irfan Ahmed is a BA student at the University of Karachi, until recently, his family was well settled in the United Arab Emirates (UAE). Then his father was forced to resign from his job, and everything changed for the entire family.

“We had to move back immediately. It was traumatic for everyone,” said Ahmed.

Coming back home did not prove to be successful for his father, who is still unemployed.

“My father is already over 50 years old,” said Ahmed. “He will not find work very easily, and we don’t have enough money to start a business here.”

Shortly after arriving, Ahmed’s elder sister landed a job at a local firm. Currently, she is the sole breadwinner of the family, but their financial condition means that Ahmed, too, will have to juggle employment with his studies. “I am already looking for work,” he said.

Irfan Ahmed’s story is not unusual. The recession in the UAE economy has proved to be disastrous not only for the real estate sector in the country but for all businesses. There have been a massive number of job cuts, with Pakistanis and Indians being the worst hit among the salaried class. As Pakistani families established in the UAE pack up and return, the excitement that came with the thought of settling in Dubai has long ceased.

“Inbound flights to Dubai are almost empty, whereas passengers for outbound routes are battling for seats,” said an expert in the aviation industry in Dubai.

According to the expert, there are two broad categories of people who are trying to leave.

“The first comprises all those employees who had been made redundant within a moment’s notice, and the rest are those who either fear for their job or have already been informed that they will be laid off in the coming months,” he said.

There is now an overwhelming sense of concern among Pakistanis in Dubai, many of whom no longer have prospects in the UAE or anywhere else.

“Pakistani residents with families in the UAE have one of two options: leave for Pakistan immediately, or wait until the children’s academic year finishes,” said Syed Akhtar, a sales agent based in Dubai.

Akhtar added that most families opted for the latter, as leaving immediately would affect their children mentally, emotionally, and academically.

“Many families I know had enough savings to pull through before school closed for the summer,” said Akhtar. “While they waited, they worked on setting up a home in Pakistan and looked for means of earning a living there.”

Amna Islam, an HR professional at a local firm, explained that people returning to Pakistan after the global recession are either venturing into small businesses or looking for job opportunities.

“Either way it’s not easy for them as their life had to be abruptly uprooted and replanted elsewhere,” she said. “It is especially difficult for middle-aged men, whose chances of finding a job here in Pakistan are very slim.”

It is a fact Emad Sultan, a banker by profession, is well aware of. Made redundant at his workplace in the UAE, he is one of many who have failed to find work since returning to Pakistan.

“All the young men I knew who were laid off immediately went back to their home countries, as there was no point living in the UAE anymore,” he said. “Some searched for alternative jobs, but I don’t know anyone who succeeded.”

While many Pakistanis have left the UAE altogether, some have remained behind to work while sending their families back home. “Job insecurity is very high in the UAE - everyone is stressed,” said Sultan. “Pakistanis and Indians are amongst the worst affected, especially those who had been associated with the real estate sector.”

From: thenews.com.pk

Dubai real estate business in trouble as property show opens in muted mood

A Dubai based real estate business has become a victim of the economic downturn and been forced by the credit crisis to close, it is reported.

Milford Real Estate, which was established in 2002, is one of the first full casualties of the property collapse in Dubai which has seen prices plummet by up to 50% in some areas.

Pam Brown, general manager, told a local newspaper that the business had folded. When Property Wire tried to contact the business today all telephones were on answering machine with a message saying that no one was available to take the call.

The company has between 20 and 28 employees in two offices, one on Sheikh Zayed Road, the other at The Harbour Hotel and Residence at Dubai Marina.

The business sold a range of property in Dubai as well as the other emirates, from luxury island villas to high tech metropolitan style apartments.

The news came yesterday on the opening day of the International Property Show in Dubai and added to the depressed mood. 'These are the difficult times and we must admit the reality and then find the solution,' said Abdullah M Al Shizawi, managing partner of Heart of Capital.

'Last year, visitor turn out was amazing and we had number of good deals. But today there are almost no visitors,' he added.

Dawood Al Shirawi from the Strategic Marketing and Exhibition, the event organiser said that it was challenging. 'Right now the local market is going through the correction period due to the global recession,' he said. Only serious investors are visiting the fair to check the pulse of the market, he added.

Those attending this year's show are hoping that lower prices will help to kick start the struggling property market soon.

However Shaikh Mohammed bin Khalifa Al Maktoum, Chairman of Dubai Land Department said at the opening that the industry needs to look to the future. 'Dubai will be the fastest city to recover from the impact of the ongoing credit crunch, and the emirate's real estate sector will once again witness a period of long term boom,' he said.

'However, developers need to remain focused on their goal of continuing with the projects that they have already started and ensure that these projects are delivered on time,' he added.

From: propertywire.com

Indians begin to return home as Gulf dreams crash downturn on Asian remittances

New Delhi - Amid new layoffs each passing day, the evenings at Dubai's Jebel Ali labour camps, home to thousands of South Asian workers, are fraught with economic uncertainty and gloom.

Half a dozen migrants gathered recently at a flat to comfort Indian construction worker Sunam Mallaiah, who had just lost his job. Unsure of their own livelihoods, the men were unable to offer words of hope.

Mallaiah went into debt and sold his land in the southern state of Andhra Pradesh to raise 150,000 rupees (3,090 dollars) for a recruitment agent to get him work in Dubai, one of the seven states of the United Arab Emirates.

Merely weeks into his 1,600 dirhams-a-month (436-dollars-a-month) job, the 30-year-old's dreams of a better life for his wife and child back home have faded away.

With the building boom going bust after the global economic downturn hit the region, older workers like Bangladeshi Shahjehan Alam are worried about their friend.

'He is mostly quiet, troubled about how to return home with debt and an empty pocket,' Alam said in a telephone interview. 'We fear he might commit suicide.'

India's Overseas Affairs Ministry insists the situation is not alarming, but reports of job losses and wage cuts have been pouring in from the United Arab Emirates and Bahrain, which have been hit by a combination of a slump in oil prices and a downturn in the construction, real estate and tourism sectors because of the global slowdown.

There are 1.8 million Indians in the United Arab Emirates and 400,000 in Bahrain, accounting for about half the 5 million Indian workers and managers in the Gulf region. Indians have been affected to a lesser extent in other Gulf countries such as Kuwait, Oman, Qatar and Saudi Arabia.

Although there are no exact figures, the Indian consulate in Dubai has said construction firms there had bulk-booked planes next month to fly 20,000 to 30,000 workers back home on long leave or to redeploy them on projects in other Gulf nations like Qatar.

According to unofficial estimates, Andhra Pradesh has seen thousands returning to their homes in the northern Telangana region over the past few months while Kerala, another southern state that sends huge numbers of workers abroad, is reporting 150 returns a week.

White-collar Indian professionals and technicians are facing the axe too. The spate of job losses is mostly in the financial and banking sectors and hotels. Those in sales and marketing are also regarded as dispensable.

'Four of my friends from the finance sector and hotels were fired overnight from their jobs though they were very good professionals,' an Indian executive with Emirates International Telecom said. 'With several firms going in for cost-cutting, people are being hired at lower wages. Others are forced to return as their salaries do not support their stay anymore.'

'Till 2008, the Gulf was witnessing realty and construction booms and attracted workers in droves,' KV Shamsuddin, who heads an Indian welfare organization in Dubai, said by telephone. 'But now, 260 billion dollars worth of real estate projects are reported to have been delayed or shelved in the UAE.'

According to workers, property giants like Nakheel, Damac, Emaar Properties PJSC and al-Shafar have laid off thousands of workers over the past few months.

'Some companies have sent them back on leave without pay while a few even use the lottery system for terminating services,' Alam said.

Concerned that a wave of redundancies could translate into a crisis, the Indian government is keeping a close watch.

But although the situation is dire for the overseas workers, the lack of jobs in the Gulf is not expected to have a major effect on the Indian economy overall, Overseas Affairs Ministry spokesman Akshay Rout said.

Indians, comprising 38 per cent of the 13 million expatriates in six Gulf countries, contribute more than one-fifth of India's total overseas remittances, which constitute 3 per cent of the country's gross domestic product.

Migration to the Gulf region, which employs the largest number of Indians outside the country, has helped countless thousands of Indian families avoid poverty in the past decade. Remittances have driven construction, tourism and education in states like Kerala and Andhra Pradesh.

'Layoffs, especially in the construction sector, are likely to have serious economic repercussions for households in India as many depend on remittances,' said Avijit Nanda, president of TimesofMoney, a leading Indian online payment-service provider.

'Since January, there have been appeals by the diaspora for financial help and starting rehabilitation and re-employment schemes,' an Overseas Affairs Ministry official said on the condition of anonymity.

'Although I will officially tell you there is not much to worry about, we are anxious as this is going to turn worse in the coming days.'

From: monstersandcritics.com

Roots Land Real Estate in the International Property Show 2009

The current economic climate is currently in turmoil which in turn also creates opportunities for cash rich investors fishing for distressed real estate deals. The steep drop in prices attracts investors and end user alike to buy properties for two reasons: low prices and flexible payment plans. For these reasons we at Roots Land believe that participating in the IPS 2009 is the right choice.

We belief that the economic condition in the UAE is still strong and the market will heal quicker than expected, comparing with mature markets such as in Europe and the US. The return on investments (ROI) is still higher in the UAE during these difficult conditions relative to that of the mature markets. We in Roots Land have compiled the finest of real estate deals in the market in order to offer a wide choice to our clients.

Our proud association with Omniyat and ETA Star is an excellent opportunity to bring investors and end users a fine selection of the projects close to completion and those to be handed over in less than 3 months. This includes projects in Dubai from JLT and Dubai Marina to Bahrain, & Panama. Riffa Views will be the first Golf Residential Project in Bahrain compromising of a wide range of villas overlooking water lagoons and the Golf Course. We are extremely proud to present our 1st issue of Roots Land Listing Booklet that we be distributed complementary to all the IPS 09 Visitors. This booklet will contain over 500 properties with opportunities for high return on investment.

In association with OMS Publishing, Roots Land will also be distributing the best seller A-Z Property Guide of Dubai from the stand. Under our current association with A-Z Property Guide in Dubai & Abu Dhabi, Roots Land would like to use this opportunity to invite you to visit our website for viewing the Property Guide online and read daily real estate and economic news in addition to mass number of property listings as well as the opportunity for people to list their properties. Roots Land Real Estate will be located in stand no. C6 Hall 2 and at be present at the International Property Show 2009 from the 15th - 17th February.

From: aim168realestate.com

Price War Rages amongst Dubai Hoteliers

Dubai’s hotel industry has entered a price war with room rates being slashed by as much as half as hoteliers attempt to attract tourists hit by the financial crisis.

The damaging effect of Europe’s recession, Dubai’s largest tourist source market, has caused visitor levels to plummet, with occupancy rates down 25 percent on those enjoyed at the same time last year.

“We are entering a price war as most hotels in Dubai are cutting their rates,” said Amine Moukarzel, the Senior Vice President and Managing Director of the Dutch-Swiss Golden Tulip group.

“The situation is very dire indeed and I believe that all hotels in Dubai are experiencing much lower rates than last year because people right now are really starting to cut down on travel budgets,” Mr Moukarzel said.

According to Habib Khan, CEO Planet Group, many hotels in Dubai have seen occupancy rates fall to between 60 per cent and 70 per cent from the 80 per cent and 90 per cent levels in the same period last year.

Hilton hotels have slashed their prices by up to 50 per cent on weekend breaks for bookings made before the end of August this year.

The enticing offer is valid in 220 hotels – Hilton, Conrad Hotels and Resorts, The Waldorf-Astoria Collection, Doubletree by Hilton and Hilton Garden Inn – across 45 countries including the Middle East, the company said.

Hilton Dubai Creek, known for its Gordon Ramsay Verre restaurant, is offering rooms at the affordable starting rate of Dh530 (US$144) compared with Dh1,944 last year, while Hilton Al Ain is promoting rates from Dh435, down from Dh870.

Weekend rates at the Hilton in Ras al Khaimah have also dropped to Dh460 from the Dh920 being charged at this time last year.

The recently opened Atlantis in Dubai has addressed falling occupancy rates by enforcing a minimum 7-night stay policy during the holiday period.

The DTCM announced a plan last week which will pave the way for Dubai to double the number of tourists it receives to 15 million annually by 2015.

“The DTCM will launch a new marketing campaign aimed at increasing the number of tourists and visitors during the Dubai Shopping Festival [which starts on Jan 10] till mid-February,” said a DTCM spokesman.

The plan includes more attractive discounts on room rates, ranging from 40 per cent to 60 per cent, in addition to a 25 per cent discount on the prices of food and beverages.

Khalid Ahmed bin Sulayem, the director general of DTCM, said the campaign was part of an effort to sustain tourist attractions throughout the year.

The campaign will use the internet, press and industry promotions to cover the UK, Germany, GCC states, India, China, Japan and Australia.

“It is no surprise hoteliers are expecting a tough year ahead but I think that we can overcome these challenges by offering attractive discounts and deals,” said Eyad Abdul Rahman, the executive director of media relations and acting director of business development at the DTCM.

“We have no plans to revise our tourism targets, so to put it simply we will achieve the goals that we have set out.”

From: etravelblackboardasia.com

UAE faces recession

Banking giant Standard Chartered said today that the UAE economy could contract by as much as 1% in the first half of this year.

The bank is forecasting a growth rate of 0.5% for the whole year but says that in the first six months the growth rate figure will reverse by between 0.5 and 1%.

The company’s regional head of research said much would depend on the UAE’s ability to meet problems such as construction slowing down, access to credit dropping and consumption and exports down.

Marios Maratheftis added: “With the right policy response – sorting out monetary policy and increasing fiscal spending – it should allow us to see the recovery in the second half.”

Meanwhile, the deputy chairman of the UAE’s central bank said he expected to see more Dubai-based developers and construction companies go cap in hand to the state for bailouts.

Omar bin Sulaiman said: “You have already seen some help and I am sure you will see some more.”

The UAE finance ministry and central bank have launched £22bn of funding facilities to help banks cope with the crisis.

From: building.co.uk

Hindu terrorists not in love with Valentine's Day vent their ire on courting couples

VALENTINE’S DAY across India was marked by unrest unleashed by Hindu extremists who attacked young couples and humiliated them publicly as they deemed the festival western and decadent.

A brother and sister mistaken for a dating couple were beaten up by a mob in central Madhya Pradesh state. And six people were arrested in the northern city of Agra, home to the Taj Mahal – the monument to love built by Mughal Emperor Shah Jehan in memory of his beloved wife – for shaving the heads of overtly romantic youngsters in a nearby park.

But the most shocking incident took place in the small town of Jind in Haryana state, some 200km north of New Delhi, in which two junior police officers were suspended for dragging a young unmarried couple out of a house and thrashing them in the middle of a busy street in full view of passersby.

The state government has ordered an inquiry into the incident which appalled most people.

Haryana is a highly conservative state where women traditionally have few rights and where female infanticide is rampant. The suspended policemen, who were no doubt encouraged by Hindu hardliners from parties like the extremist Shiv Sena, embarked on a moral re-armament drive by blackening the faces of couples caught dating publicly.

Similar hardline activists, who claim exchanging endearing gifts and kisses on Valentine’s Day is a western practice that corrupted traditional Indian values, forced one couple to exchange vows in the southern city of Hyderabad in a mock wedding ceremony simply because they were dating.

In another equally sordid episode, a young man was married off to a donkey simply because he was with his girlfriend.

“Our culture is the greatest and we can’t allow youngsters to ape the West and indulge in indecent acts like dating,” said Satish Mann, a member of the Bajrang Dal, one of the major Hindu groups behind the threats and protests.

Extra police patrolled shopping malls, restaurants and cinemas across major Indian cities on Saturday to protect couples from such Hindu extremists who had threatened to forcibly marry young people found together.

Hundreds of potential troublemakers were also taken into preventive custody to prevent trouble, but some fringe groups managed to unleash their fury on hapless lovers.

They also vandalised shops selling Valentine cards and flowers, forcing many to shut down.

The trouble surrounding Valentine’s Day erupted last month after Hindu vigilantes calling themselves Sri Ram Sena, or Lord Rama’s Army, dragged young women out of a trendy bar in the southern city of Mangalore and beat them up.

This provoked a major public debate on values in India’s rapidly changing society and major economic power that invites overseas investment.

But a group calling themselves the “Consortium of Pub-going, Loose and Forward Women” responded robustly to the extremists’ campaign by sending them boxes containing pink knickers as a Valentine’s Day gift.

From: irishtimes.com

Hindu extremists in Valentines Day attack on lovers

VALENTINE'S Day in India has been marred by a series of attacks on young couples as Hindu radicals battle what they claim are foreign influences corrupting Indian culture.

Six men from the Hindu group Shiv Sena were arrested in Agra, home of the Taj Mahal, after they cut the hair of overtly romantic couples in a city park.

In Pune, western India, two couples were stopped by Shiv Sena activists and forced to "marry" on the spot by exchanging flower garlands. Five other members were arrested in Delhi for threatening couples.

In the central city of Ujjain, a mob of Hindu fanatics beat a brother and sister they mistook for a couple displaying affection. Activists also blackened the faces of couples they said were behaving inappropriately in Aurangabad and Bijnaur.

Valentine's Day has recently become very popular in India but many, not just Hindus, consider public shows of affection taboo.

A policeman in the northern state of Haryana was filmed attacking a female college student he said was "involved in immoral activities". The graphic video showed the officer, Molla Ram, spinning the woman around by the hair. He was later suspended.

The violence coincides with a "culture wars" debate over the influence of foreign culture.

Last month, a Hindu nationalist group, Sri Ram Sena (Lord Ram's Army), brutally attacked a group of women drinking and dancing with men in a pub in the southern city of Mangalore.

It exposed deep social divisions over traditional values and behavioural standards.

The Minister for Women and Children, Renuka Chowdhury, accused the Mangalore attackers of wanting the "Talibanisation" of India.

A group calling itself a "Consortium of Pub-going, Loose and Forward Women" has urged supporters to send a pair of "pink chaddis" - slang for underpants - to Sri Ram Sena in protest over the pub attack. Some 32,000 people have joined the campaign.

Despite the controversy, couples flocked to restaurants and cafes in Delhi's Connaught Place for a Valentine's Day dinner. Some had special menus prepared for the evening with offerings like "Couples Coffee".

From: brisbanetimes.com